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Surpassing Verizon, TracFone notches 1.1M net adds in Q4

Feb. 9 2011 - 6:03 pm - América Móvil's TracFone MVNO service netted a whopping 1.1 million new subscribers in the fourth quarter of 2010, finishing the period with a total of 17.7 million subscribers.

TracFone's net adds put it in the same league as some of the nation's Tier 1 wireless carriers. For example, Verizon Wireless (NYSE:VZ [1]), the nation's largest wireless carrier, recorded 955,000 total net customer additions in the fourth quarter, ending the period with 102.2 million "total wireless connections."

Such a comparison isn't completely fair, however. TracFone doesn't operate its own wireless network--instead, as an MVNO, the company essentially piggybacks on the networks of Verizon , AT&T Mobility (NYSE:T [2]) and T-Mobile USA, reselling their services under TracFone's brands, which include Straight Talk, Net10 and others. Thus, TracFone's net customer additions are also counted by its host carriers under their "wholesale" column.

Nonetheless, TracFone's stellar growth is notable. The company has grown its U.S. subscriber base from 14.4 million in December of 2009 to 16.7 million in September 2010 to 17.7 million at the end of the fourth quarter of last year.

As for TracFone's subscriber metrics, the company's minutes of use skyrocketed 219 percent year over year, from 94 in the fourth quarter of 2009 to 300 in the fourth quarter of 2010. TracFone attributed the growth to its Straight Talk unlimited service. TracFone's average revenue per user grew from $10 to $14 during the same period while its churn remained relatively unchanged at around 4 percent.

WASHINGTON, DC –CTIA-The Wireless Association® issued the following statement today in response to the OECD Communications Outlook report on usage and cost for mobile phone calls:

The headline from the recently released OECD Communications Outlook report reads that Finland, the Netherlands, and Sweden have the lowest prices for mobile phone calls among OECD countries, while the highest prices were found in Canada, Spain, and the United States. But since U.S. consumers enjoy the lowest per minute rates of all of the OECD countries, what today’s OECD report really shows is that some international comparisons just don’t make sense – especially when built on flawed assumptions.

The real story is buried on page 275 of the OECD report which states:

“It is important to note again that the OECD calling pattern in the basket can be significantly different than common calling profiles in a specific country. For example, the high-usage OECD basket includes 1,680 outgoing voice calls per year while users in the United States average 9,600 minutes of voice calls (combined incoming and outgoing) per year. In this case the basket provides the cost of buying exactly the calls and messages in the OECD basket rather than what may be considered a ‘typical’ bundle in the market.”